Is this U.S.-China selloff a buy? A top Wall Street voice weighs in
Investing.com - Truist Securities raised its price target on TopBuild Corp (NYSE:BLD) to $390.00 from $370.00 on Thursday, while maintaining a Hold rating on the stock. The stock currently trades at $432.75, near its 52-week high of $445.74. According to InvestingPro analysis, TopBuild appears to be trading above its Fair Value.
The price target increase follows TopBuild’s acquisition of SPI, which expands the company’s presence in industrial insulation distribution and fabrication. Despite the deal’s initially lower margins, Truist Securities noted that such acquisitions typically deliver quick supply-side synergies, accounting for half of the projected total synergies.
The SPI acquisition, combined with TopBuild’s recent commercial roofing installation deal, has shifted the company’s business mix significantly. Non-residential business now represents 47% of TopBuild’s operations, altering its cyclical exposure profile.
Truist Securities maintained its Hold rating due to anticipated continued pressure on TopBuild’s residential business in the near term. The firm acknowledged this pressure as a limiting factor despite the company’s strategic acquisitions.
The research firm highlighted that TopBuild now offers investors substantial exposure to both residential and non-residential market cycles, representing a notable change in the company’s business composition.
In other recent news, TopBuild Corp has completed its $1 billion all-cash acquisition of Specialty Products and Insulation (SPI), a move that is expected to bolster its specialty distribution capabilities and expand its presence in commercial and industrial markets. The acquisition, finalized on October 7, 2025, was funded using cash on hand, including proceeds from a $750 million senior notes issuance in September. SPI, headquartered in Charlotte, North Carolina, generated approximately $700 million in revenue and $75 million in EBITDA for the twelve months ending June 30, 2025. Notably, the acquisition does not include SPI’s metal building insulation business.
In connection with this acquisition, Evercore ISI has raised its price target for TopBuild to $449, maintaining an "In Line" rating. The recent issuance of $750 million in senior notes, priced at 5.625%, is intended for general corporate purposes, potentially including further acquisitions. The offering is expected to close on September 25, 2025, pending customary closing conditions. These developments underscore TopBuild’s strategic efforts to enhance its market position and financial flexibility.
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